In brief

The Conservative Party minority government is led by a politically weak prime minister, Theresa May, and depends on parliamentary support from the Democratic Unionist Party. We expect the political deadlock associated with the Brexit process will force a delay of the UK's planned withdrawal from the EU on March 29th. A second referendum on the issue is now likely. The government will struggle to last a full term to 2022. The economy lost momentum in 2018 and we expect a further slowdown in 2019.